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Even though it’s possible to get instant approval personal loans with your bad credit history, do bad credit personal loans with guaranteed approval really exist in Australia? It may seem tempting for you to take your chance on pesonal loans, however, note that there are things that are too good to be true.
Bad credit personal loans with guaranteed approval are commonly offered by abusive lenders or a large red sign of a loan scam coming your way. It is not legally possible for bad credit personal loans with guaranteed approval to exist because lenders are legally required to comply under responsible lending obligations that are prescribed by the National Consumer Credit Laws. To protect both lender and borrowers, lenders should be able to ask a loan applicant on their ability to pay back the loan they’re applying for.
As mentioned already, bad credit personal loans with guaranteed approval are highly likely to be red flag signs for a loan scam coming your way. The most common way to assess whether a loan offer is a scam is when they tend to ask you to pay fees upfront. If a personal loan with guaranteed approval pops out of nowhere and are offered to you, chances are it’s a scam. It is a good idea that you check data on the internet or ASIC Connect’s Professional Registers for a list of companies that have an AFS license, since all financial services in Australia are legally required to acquire an AFS license to operate.
Instead of guaranteed approval, Loanbubble offers you a personal loan even if you have a bad credit history. We strive to please and provide our customers a fair chance to get approved of our loan products, and we believe that your credit rating-poor should not only be the factor that gets considered when getting yourself a personal loan.
Bad Credit Personal Loans Explained
To explain further, these best personal loans are usually offered by non-traditional banks such as building societies, credit unions, or peer-to-peer lenders that may accept your loan application despite having a bad credit rating.
Your current relationship with money is usually the main focus of lenders when they evaluate your loan requests. They check your income flow, expenditures, and other debt obligations. They then make a decision on whether you have the ability to pay back a loan and how much of a loan amount they can offer you which includes personal loans for the unemployed
If you want to get approved for large loans, you’ll need to have a good credit rating. Lenders will need assurance that you can be trusted to pay them back what you owe should they lend you cash. This is why your borrowing history will matter the most. Still, a bad credit doesn’t mean you won’t ever get approved for a large loan. Lenders may be more lenient if you will present a co-signer, a person whom the lender can go after if you cannot make your loan repayments anymore. Offering a loan collateral is also another way to do it. You attach a valuable asset to the borrowing which will help secure the loan. Lenders will be more agreeable to letting you borrow a bigger figure when there is something they can potentially use to cover their losses in the event that you are unable to pay off your d
Interest Rates on Personal Loans- Bad Credit at LoanBubble
Keep in mind that personal loans that accept bad credit rating may cost you higher interest rates if compared directly to personal loans that are geared towards customers who have a great credit rating. Risk-based pricing gets applied more by many personal loan providers to charge higher interest rates for borrowers that pose to be of more risk to fail to repay your loan.
What are other bad credit score or credit- poor loan options available on the market?
Before applying for bad credit personal loans with Moneyscout, it is good that you consider all other options that are available on the market. Here are some options that you can consider:
Try to borrow money from close family or best friends
This may run the risk of damaging a family relationship or friendship, however, it may be a really a good deal because most loans coming from family or best friends do not have any interest rate and can be quite flexible. It is recommended by the National Debt Hotline that both parties agree exactly on how the money you borrow will be repaid and when should it be fully repaid. Keep in mind the other party could still take your case to court if you refuse to pay for the loan you took from your family or friends.
Guarantor Personal Loans
Simply put, these are personal loans that are guaranteed by a family member or a close friend to make approval to you loan easier. Note that if you fail to pay your loan, your guarantor will be legally responsible to take over the repayments of your loan, that’s why you should make sure that the guarantor you get understands these clearly.
Get Secured Personal Loan
An asset is required to be used as a form of collateral to be used as a security against your personal loan if you fail to pay for the loan you took. Secured personal loans may offer you lower interest rates and fees if compared to small online loans. Note that your lender can seize the asset you’ve provided and sell them to recoup the money the lost from your unpaid loan.
Low- Interest StepUP Loans
Credit checks may be required if you choose to get a personal loan through this option. These are usually low-interest loans designed for individuals who receive steay yet pretty low incomes. A fixed rate of 5.99% p.a. (5.99% comparison rate) are charged on top of your loan balance and there may be no other fees charged from you. However, you must reside on your residence for at least 90 days and have a pension card, health care, or receive family tax benefit A to qualify for StepUP loans.
No Interest Loans Scheme (NILS)
Essentially, these are loans that offer you loan products with no interest, credit checks, and other fees or charges. Your borrowing option can reach up to $1500 to pay for basic medical expenses and other essential expenditures. To qualify for this No Interest Loans Scheme, you should reside on your residence for at least 90 days and have a pension card, health care, or earn less than $45,000 a year after tax $60,000 for applicants with children or for join applicants).
Tips to Improve your Bad Credit Rating or Credit Score
Keeping your credit rating healthy should be one of your top priorities. Even if you already have a credit history- bad, making efforts to show that you want to improve your current credit rating or score will show our lenders that you are gradually and actively doing steps to manage your finances. Here are a few tips to help you out in improving your overall credit rating:
- Consolidate your existing debt obligations;
- Try to always pay your bills and credit repayments on time;
- Consider reducing the limit on your existing credit card;
- Limit your new applications for any credit or loan products in the same period of time;
- Make it a habit to check your credit report at least once a year and check for any errors and have them corrected immediately;
- Get a financial counsellor to help you manage your debts.